China’s antitrust regulators slapped a record fine on one of the country’s largest technology conglomerates, closing a months-long investigation that began
and setting the precedent for the government to use anti-monopoly rules to regulate the country’s Big Tech.
Alibaba Group Holding, the world’s largest e-commerce company and owner of this newspaper, was fined 18.2 billion yuan (US$2.8 billion) by the State Administration for Market Regulation (SAMR).The Hangzhou-based company “abused its dominant market position in China’s online retail platform service market since 2015 by forcing online merchants to open stores or take part in promotions on its platforms,” compelling the market to “
” in a breach of the country’s anti-monopoly law, the regulator said on Saturday.Alibaba was ordered to correct its misconduct, and pay a fine equivalent to 4 per cent of its total 2019 revenue. The fine was nearly three times
, the world’s largest supplier of mobile chips, in 2015.[…]
The antitrust investigation of Alibaba was part of the Chinese government’s effort to tame the unfettered growth of the country’s tech behemoths, and to ringfence financial security and prevent risk amid a period of slowing economic growth during the coronavirus pandemic. It has been widely watched, for ramifications that could potentially affect the entire ecosystem of businesses and economy centred around the internet.
The hefty fine was aimed at promoting the “healthy and continuous development of the country’s internet industry” and was by no means a denigration of the “important role of internet platforms in economic and social development,” and shows no change in the state’s “attitude of supporting internet platforms,” according to a commentary by the People’s Daily, the mouthpiece newspaper of the ruling Communist Party.